Stay-at-home parents need protection.

Posted by Steven

It’s distressing to learn how few families with young kids have life insurance. Stay-at-home parents have a special need for life insurance. Should a stay-at-home parent pass away, the remaining parent would find themselves suddenly paying for childcare and everything else a stay-at-home parent does on a day to day basis.

The minimum cost of replacing a stay-at-home parent, with one pre-schooler and one school going child, we estimate would run to at least $40,000 a year. Breaking down the price of having someone else handle our stay-at-home parent’s various duties:

  • Cooking, laundry and cleaning, $15,000
  • Child care, $8,000
  • Homework and after school help, $5,000
  • Kid’s taxi alternative, $2,500
  • Shopping, garden work, party and activity planning, finances, etc., $9,500

That’s why it’s essential the stay-at-home parent has a life policy. What you need is a policy that’s easy to buy, easy to own and cheap! Buying what’s called “protection insurance” is simple and costs practically no money at all. From Pinnacle Life a 36-year old female can get a $500,000 life insurance policy and only pay $25.69 per month. Men’s coverage is a little more expensive due to differences in factors like life expectancy.

Remember these simple pointers when shopping around for a life insurance policy

  • Researching and shopping for life insurance is easy on the internet.
  • How much life insurance do you need? The simplest rule is … whatever you can afford to maintain long-term.
  • Cash back offers and the like are good for the first year, but life insurance is a long term commitment, so get the policy that is going to be the best value over a long-run.
  • Protection insurance which is widely sold in NZ, is what is known as annually renewable term. Each year the policy premiums will increase with your advancing age. Simply put, the older you get, the more you pay.
  • Certain high risk health conditions make life insurance more expensive. If you have such a condition, be prepared to allow the insurer to have access to health records, so they can determine your price.

For a quick quote to see how much you’re likely to pay for life insuranceclick here

Not easy as I thought..

Not easy as I thought..

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Easter Cover

Posted by Ed

The official Easter holiday road toll over Easter weekend 2014 were 5 fatal crashes and 95 reported injury crashes. These crashes resulted in 5 road deaths, 17 serious injuries and 123 minor injuries. Half of the crashes reported during the Easter weekend occurred on the open road.

Common types of crashes:

  • 43% of crashes were single vehicle crashes in which a driver lost control or ran off the road
  • 24% were intersection collisions
  • 14% were rear end crashes or collisions with obstructions (such as parked vehicles)
  • 7% were head-on collisions.

The most common driver factors contributing to crashes:

Losing control (40% of crashes); travelling too fast for conditions (25%); failing to give way (20%) inattention (18%); inexperience (18%); alcohol (15%);

The official Easter holiday period for 2015 will begin at 4 pm Thursday 2 April and end at 6 am Tuesday 7 April. Make sure your life cover is in place. Please drive carefully and enjoy the long-weekend.

Easter bunny

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Who cares about life insurance?

Posted by Steven

The problem with life insurance is that those who need it most, don’t have it, or they can’t get it due to their health. It’s distressing to learn how few people with young kids have life insurance. Stay-at-home spouses have a special need for life insurance. Should a stay-at-home parent pass away, the remaining parent would find themselves suddenly paying for childcare and everything else a stay-at-home parent does on a day to day basis. That’s why it’s essential the parent at home has a policy.

Too often, we’re sold insurance products with the broker’s eye on commissions rather than genuine need or affordability. That’s a recipe for failure when you have to pay the premium, and it sets too many of us up for a lapse in coverage. Approximately 25% of people who buy life insurance stop paying their premiums in the first three years. By the 10-year mark, almost 50% quit paying. So you pay all that money, month after month, to wind up with zip.
What you need is a policy that’s easy to buy, easy to own and cheap! Buying what’s called “protection insurance” is simple and costs practically no money at all. From Pinnacle Life a 45-year old male can get a $250,000 life insurance policy and only pay about $35 per month. Women’s coverage is even cheaper because they generally go to the doctor and take care of themselves a lot better than their male counterparts.

Remember these 5 pointers when shopping for a policy

  • Shopping for life insurance is easy on the Internet.
  • Certain health conditions make insurance more expensive or even unavailable. If you have such a condition, you’re what’s known as “loaded” in the industry, which means you will pay more money than the example given for a 45-year-old guy.
  • How much life insurance do you need? The simplest rule is … whatever you can afford to maintain long-term.
  • Stay-at-home spouses who care for children should have insurance too. They have an “insurable need” because you’d have to pay someone to care for your children in the event a spouse or partner dies.
  • Cash back offers and the like are good for the first year, but life insurance is a long term commitment, so get the policy that is going to be the cheapest over a long-run.

For a quote to see how much you’re likely to pay for life insurance, click here

Alice Life

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Life insurance advert gets 6.5 Million views in 10 days!

Posted by Steven

It begs the question, how does a life insurance company get 6.5 Million YouTube views in 10 days?  Well, it starts by spending $3.5M for a 30 second Super Bowl advertisement, and another $1.5 M in production, and wollah…. mission completed!. So you’d would think, but actually Nationwide Insurance, a large American Insurer, has courted much controversy in its efforts to create an impact for their $5M investment. Marketers have always used controversy to create an impact, getting consumers speaking about a brand is generally deemed good marketing. But controversy and Insurance companies is a different matter.

Insurer’s like to display images of happy families, smiling children running on the beach, pregnant mothers…. zzzzzz… who-ever remembers happy families running on the beach? So Nationwide decided to promote a rather taboo topic, the death of children. It’s an unpublicized fact, but children are far more likely to die by accident around the home than by any sickness or ailment in developed countries. So Nationwide took it upon themselves to drive home this unpleasant message, and if its audience you looking for, no better place than Super Bowl 2015.

Reaction has been rather mixed, some have viewed the advert as nothing more than highlighting misery to sell insurance, and others believe it to be informative. As for Nationwide’s view on its $5M punt.. last I heard the marketing manager still had a job, 6.6M views YouTube views in 10 days .. you decide!

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“Do you by any chance have a Life Insurance policy in my dads name?”

Posted by Steven

You’d be surprised how many calls we receive each month asking us to please check our records to see if somebody’s parent or sibling by any chance had a life insurance policy with Pinnacle Life. The conversation goes something like this … ” We think our dad/mum/brother may have had a life insurance policy, but we’re not sure which company he had the policy with, and we have no access to his bank account records… can you help?”

Of-course trying to help these poor souls is in itself a challenge given the privacy and data protection act we are obliged to adhere to. All too often this gets confused with “Ah typical insurance companies.. take your money month after month, but when claim time comes, everybody hides”. It’s very hard to take an anonymous call, and on the basis of a sob story, search your database to see if one can get a name / d.o.b match.  The search is not hard, it’s the validity in doing the search, and then having to inform the desperate caller that you’re very limited in what sort of information you can reveal if a match is found.

While buying life insurance there’s another important step to take after purchasing a life insurance policy before you can consider the job of protecting your family done: You need to share this important information with your beneficiary (your spouse, your children, a sibling, a business partner — whoever you’ve designated on your policy).

It’s vital to tell that person or persons not only that you’ve taken out a policy, but also which life insurance company is holding it. Without this critical knowledge, your beneficiary may not be able reach the insurer to submit a claim.

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5 Great Lifestyle Apps

Posted by Steven

New apps are constantly being introduced with the aim of keeping us healthy, happy and organised. Here are five top free apps that will help you achieve a healthy lifestyle, whether your goal is to stay in shape, lose weight or just feel better.

Exercise App: Nike Training club

Whether you are at the gym or in your own living room, Nike’s official app can help you get fit and teach you specific exercises to integrate into your own personal workouts. The well-designed app features full 30 to 45-minute workouts, all based on your goals and fitness level. Helpful photos show users how to properly execute each exercise, and audio cues during the workout help keep you motivated. It even includes step-by-step instructions and how-to videos for every exercise a users can complete goals to earn rewards such as celebrity training videos

Diet and calorie counter: MyFitnessPal

Lose weight with MyFitnessPal, the fastest and easiest to use calorie counter. With the largest food database of any calorie counter, and amazingly fast food and exercise entry, MyFitnessPal will help you take those extra kilograms off with the least amount of effort. There is no better diet app I’m told, and how can 10 Million downloads be wrong?

Ovulation and fertility: Period Calendar

Predict when your period starts and your likely chance of pregnancy. This app goes one step further, not only is it an accurate ovulation calculator and cycle tracker, it also provides 43 symptoms and 64 moods to choose from. Period Tracker has your privacy in mind—the app features a discreet on-screen thumbnail that requires a four-digit access code keeping your personal data safe from prying eyes

An app to motivate you through your exercise routine: Nexercise

If virtual badges and trophies aren’t enough of an incentive to get you off the couch, then perhaps a chance to win actual, tangible prizes will do the trick. Nexercise is an exercise gamification app that awards you with points for just about any type of physical activity and allows you to use those points to claim prizes like gift cards and discounts from various retailers. No matter if you’re running a marathon or running the vacuum cleaner, Nexercise will track your fitness progress and reward you for your efforts.

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Skin cancer myths debunked

Posted by Steven

Each year more than 70,000 people in New Zealand are treated for skin cancer. Several facts about skin cancer are probably familiar: it’s very common, it’s often linked with sun exposure, the most common types are basal cell carcinoma and squamous cell carcinoma, and the most deadly type is melanoma. Other facts are less well known, however, and may even seem counter intuitive. Prepare your skin for summer by understanding the truth about several common skin cancer myths.

Skin cancer affects only the elderly.

Your risk of skin cancer increases as we age. However, children and young adults can also be affected, and rates in young people appear to be on the rise. The importance of skin cancer prevention and early skin cancer detection is not dependent on one ones age.

Skin cancer appears only on sun-exposed parts of the body.

Although cancers such as basal cell carcinoma most commonly appear on sun-exposed areas of the skin, skin cancer can appear anywhere on the body. This includes the soles of the feet, the palms of the hands, and beneath fingernails and toenails.

SPF tells me all I need to know about the sun protection of sunscreen.

Ultraviolet radiation is often divided into three types: UVA, UVB, and UVC. Although the sun emits all three types of ultraviolet radiation, only UVA and UVB reach the surface of the earth. UVB is the cause of most sunburns and has long been recognized as carcinogenic. UVA—which penetrates more deeply into the skin—was initially thought to be relatively safe, but it’s now recognized that both types of ultraviolet radiation are likely to contribute to skin cancer.

The sun protection factor (SPF) of a sun block refers only to protection against UVB. There is currently no standard measure of protection against UVA. To get protection against both types of ultraviolet radiation, look for sun block that provides broad-spectrum protection against UVB and UVA. Apply sun block liberally and reapply at least every two hours. It’s also important to keep in mind that sun block is only one part of a sun protection. Avoid of the sun during peak hours and use protective clothing such as hats and long-sleeved shirts.

Skin cancer affects only light-skinned people.

Skin cancer rates tend to be much higher among Pakeha than among Maori and Pacific Islanders in NZ (10 to 1 ratio). Darker-skinned people are not immune to skin cancer however, and may be at higher risk of death when skin cancer develops.

Indoor tanning is safe.

Bad news is that tanning beds—like the sun—expose the skin to ultraviolet radiation, and a growing body of research indicates that indoor tanners have an increased risk of skin cancer, including melanoma. Risk may be particularly high when indoor tanning begins at a young age.

Once you’ve had skin cancer getting life insurance is impossible.

Basal cell carcinoma—the most common type of skin cancer—is often highly curable. At Pinnacle Life, so long as the basal cell carcinoma has been removed with no lingering effects, you can purchase life cover online with no additional rate loading

If you notice a change to your skin, discuss it promptly with your physician. Skin cancer treatment is easiest and most effective when the cancer is caught early.


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An idiot’s guide to disability insurance

Posted by Steven

What would happen if you had an accident, or a debilitating illness took away your ability to work. “How would you survive — how would you pay your bills? It is a wake-up call that inspired the concept of disability insurance.

What is disability insurance?

“Disability insurance protects your earning power.” It helps cover your loss of income by providing you with a monthly benefit if you’re unable to work for a certain period of time due to an accident or illness. In reviewing disability insurance you need to be careful to ask;

  • how a disability is defined,
  • what conditions are covered and
  • how much and how long you can expect to receive income

How is disability defined?

Disability insurance pays a monthly benefit to help cover loss of income for those under age 65 (generally) who can’t work because of an injury or illness. The definition of “can’t work” is a key factor in determining the type disability insurance and cover. A distinction is drawn between, can’t work in any occupation? or can’t work in the occupation you’re currently employed.

The terms of reference in any disability cover product will highlight the insurer’s obligation to pay. Products that define a disability that results in an inability to work in “any occupation” are generally cheaper, as the insured needs to be severely disabled to the extent that they cannot perform work tasks in any occupation. For example, a builder who suffers a back problem, may be prevented from working in the building industry as a labourer, but a back injury will not be an impediment to a regular office job.

On the other-hand, disability insurance that covers “own occupation” enables the claimant to make a claim so long as the disability prevents the insured from employment in their current occupation. For instance, a musician with “own occupation” disability cover will be entitled to claim if one of their fingers was broken accidently, and the musician was unable to earn a living for a period of time. Naturally, such disability insurance is a lot dearer, and usually only covers a % of income earned and for a limited period of time.

What conditions are covered?

  • Total and permanent disability (TPD): is one that “will remain with a person throughout” his or her lifetime, or he or she will not recover, or “that in all possibility, will continue indefinitely.  If your job is knowledge and communication based, it is very difficult to be totally disabled. If you can think and talk – you can work – at least somewhat.
  • Non-total disability (NTD):  covers the insured in the event that the injury sustained does not have to be permanent or total, and the beneficiary is entitled to make a claim so long as the disability resulted in a loss of income for a defined period of time.

How much and for how long?

All disability covers have a claims limit. TPD payments tend to be lump-sum one-off payments. Disability income products (NTD’s) tend to pay a proportion of income earned for a period of time. Often these products will also have a stand-down period before any claim can be lodged. For example you must be off work for a period of more than 30 days, and the payments will cease after a period of time.

Other interesting facts!

Of all the products sold by insurers, disability insurance is the one most likely to end in dispute between the parties. The propensity for fraudulent claims are high. Overstating income, or overstating disability effects result in prolonged and excessive payments for the insurer. The evolution of this product has seen higher and higher rates to cover insurer’s claim experience.

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How much life insurance do I really need?

Posted by Steven

How much life insurance do you really need? It takes a few steps to calculate, but it’s not rocket science. The only thing that really matters when it comes to determining how much life insurance you need, is how much income do your dependents need if you aren’t around? To answer this you have to first answer these two questions;

  1. how much do you spend each month? (Use your bank statements to calculate your monthly average spending) and
  2. do you have any realisable investments or assets other than that marked for retirement or future know expenses like kids education?

A working example to calculate your insurance needs…. Let’s say you know you spend $6,000 each month to pay all your bills including your debt repayments. Of the $6,000, you earn $3,500 and your partner earns $2,500. Your monthly income is equivalent to $42,000 a year ($3,500 x 12). You need enough protection insurance so that if you pass away, you could invest the proceeds and earn $42,000 after tax. How do you calculate that? If you assume you could earn 5% on the money, simply divide $42,000 by 5% and you have your answer. In this example, the number is $840,000 (42,000 / 0.05). That’s how much savings you need to invest at 5% to earn $42,000. The $840,000 is what your survivors need to get through until they don’t need your income. You can offset it with other insurance you already carry or if you have savings or realizable assets that isn’t earmarked for retirement or other purposes. This isn’t a scientific approach – it’s a ballpark calculation. But it’s pretty close to what you need, and it’s a calculation you can do yourself. It’s also a heck of a lot better than a wild guess.

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Could you work with your business partners spouse?

Posted by Steven

If you’re in a partnership business (regardless of the legal structure) you definitely need some life insurance. In all likelihood each shareholder brings a unique skill set to your business; it’s probably the fibre that brought you all together in the first instance. Together your skills complement each other and provide all the necessary tools to run a successful business. In the ordinary course of events, if one partner should die the likelihood is you’re about to inherit by default a new business partner. One which is very unlikely to have the same skill set as your last, a business partner whom now owns shares in your business, where  in all probability they would have preferred the cash.

A simple buy-sell agreement in the event of a business partner’s death or disability will allow one partner to buy out the other partner(s) in the case of death or terminal illness. Each partner simply buys a policy on each of the other partners. In the event a partner dies, the other partners have the money to purchase that portion of the business and pay the deceased family or beneficiaries.

Sounds simple and obvious enough, so why are business owners so under-insured in this space given the low cost of protection insurance?

  • In many circumstances there can be a large age difference between partners. This is often the case in technology related industries; technological expertise comes from the younger partner, and the finance from the older partner.  Here the challenge is to get the same cover in place where lives insured may be very different by way of health and age and hence the cost of the policies will be very different.
  • When you start out, it’s difficult to put a future value on the share capital of the business in 5 or 10 years-time.
  • Some-times money does not solve the problem. Acquiring the business partner’s shares, does not solve the problem of acquiring their skill set or intellectual property.

Like all life insurance products, if you can’t afford what you’re likely to need, having some protection is better than none at all! Go to Pinnacle Life and see how little you’d pay to cover your business partner.

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